Senate set to restrict Gmail

SAN FRANCISCO: California's Senate voted to support a bill to limit a new e-mail service by No. 1 Web search company Google Inc., over concerns it could threaten the privacy of users.

California's state Senate approved the first-of-its-kind bill by a vote of 24-8 to restrict how Mountain View, California-based Google's upcoming free "Gmail" service could work once it is available in wide distribution.

Google's Gmail service, which will be supported by advertising and be free for users when it is launched to the public, is currently in beta testing.

Google had intended the service to scan e-mail for key words and concepts and use them to place targeted advertisements in personal messages.

The bill by Democratic State Sen. Liz Figueroa would require Gmail to work only in real-time and would bar the service from producing records.

The bill also would bar Gmail from collecting personal information from e-mails and giving any information to third parties.

Figueroa's bill now goes to California's Assembly.

Google said in a statement it would work with lawmakers to craft a bill to enhance privacy protections in Gmail.

"Google has worked in good faith with Senator Figueroa and her staff to address her concerns about privacy and online communications," Google said in the statement. "We believe we have reached conceptual agreement on most of the key points, but we have not yet reached agreement on all the details. As is the norm in the legislative process, work still remains on the specific language of the bill."

Industry analysts see Gmail as a key product for privately held Google because it could boost revenues from advertisers and expand the company's business as it nears its widely anticipated initial public offering of stock.

The move by Google into e-mail comes amid increasing competition from Yahoo Inc. and Microsoft Corp.'s Internet Division, MSN, which built strong user bases around free e-mail services and have been attacking Google's prominence as a Web search service.

Google fought back by adding a price-comparison-shopping tool to its services and a new site exclusively offering news.

©Reuters